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Recently I had the embarrassing experience of having my credit card denied…for a $1 purchase. And it wasn't even April Fool's Day!
Has it ever happened to you? You get that sinking feeling that everyone in the store just heard the clerk say it. You even feel a little guilty—how could I have given this nice woman a bad credit card?
But wait! I was nowhere near my credit limit and now there’s that adrenaline rush of fear. Has someone else been using my card?
No, the answer is really simple, but you may not know about it until it happens. The problem was that while I was inside the convenience store buying a bottle of water, my husband was simultaneously pumping gas outside, after using the same credit card to pay at the pump. Strange that it never happened before, actually.
Here’s another heads up, and it’s related. If you use your debit card at a gas pump, be aware that your checking account may have a hold on up to $75 of your money, unless you are using a pin code to authorize the purchase. Use of the pin code causes the transaction to post immediately.
However, if you are using your debit card as if it were a credit card, i.e. running it through the pay-at-the-pump slot, assume the worst.
This is because the card is authorized before the gas is pumped, and the computer doesn’t know whether you’ve parked a semi rig at the pump or a compact car. That’s why my $1 purchase was denied…my husband wasn’t finished pumping the gas, so the computer didn’t know how much the transaction would amount to.
Each oil company’s policy on how much they reserve is different, so it pays to know the policies for the one you use the most.
Now, if you live close to the edge and you pay at the pump with your debit card and then go grocery shopping, look out! You could conceivably bounce that check to the grocery store, or have the debit card denied.
Consumer-protection advocates would like to see this policy changed, or at least disclosed, as it isn’t uncommon for these blocks to remain for several days. The length of time the block remains is related to how often the store or station runs a batch of credit transactions. Consumers feel they should be informed, and I would agree. However, according to an MSN article, it doesn’t appear that anything will be done soon.
The same article gives these tips about how to protect yourself:
-If you must use a debit card, pay inside where you can use your PIN number; PIN-based transactions are registered immediately.
-If you pay at the pump, use a credit card. (just don’t try to use the same account at the same time) :-)
-Oil companies' proprietary charge cards often don’t have any kind of block feature on them, but sometimes do. Chevron, for example, briefly blocks out $18.
-Good old cash is still good -- and many gas stations, tired of paying high credit-card fees, now give a discount of up to a dime a gallon for cash. Look for such deals.
Cheri
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